INDUSTRY NEWS

Semiconductor industrial park set for
California-Mexico border

ILLUSTRATION BY KELLY JOHNSON

The developers behind an ambitious plan to build a semiconductor industrial park on the border between the United States and Mexico expect to break ground in early 2005.

Ron Jones, CEO of Silicon Border Development, says the corporation has been pursuing design and construction financing with the expectation that groundbreaking will take place "possibly sometime in the first quarter" of next year. The timing is slightly ahead of the original schedule, according to the executive. Silicon Border's budget is $300 million to $400 million.

Plans for the 15-square-mile industrial park were announced in mid-July at Semicon West in San Francisco. Silicon Border Development signed an agreement with the state government of Baja California, Mexico, to build the park in Mexicali. The site is on the western boundary between Mexico and California, approximately 120 miles east of San Diego. The location is near the California border town of Calexico, off U.S. Interstate 8.

The Baja government granted Silicon Border exclusive development rights as well as access to water, electricity, and gas. Mexico also is offering a package of economic incentives. These include NAFTA safe harbor provisions, favorable asset-reduction rates, and tax holidays for companies with fabs costing up to $2 billion.

During the planning stages, Jones says, the developers initially had less-grandiose ideas. "We started working on this and thought maybe we'll build a fab," the executive told MICRO during an interview two weeks after the annual trade show. "Instead, we said, 'Why don't we build a science park so that we can grow an entire supply chain, if you will?'"

Jones has seen a "robust response" since the announcement, particularly from IC manufacturers, software companies, and design firms. "Fabs are really the anchors that draw the assembly and test guys further down the food chain."

Driving the project is the belief that the development will give U.S. semiconductor producers a cost-efficient alternative to Asian suppliers and manufacturers, particularly those in Taiwan and China. — JC